How Do Travel Agents Make Money?

In the days before the Internet, it was easy to understand the ways in which travel agents were paid. Now, it can be confusing since many people make their own travel arrangements, so how do travel agents make money? There are still plenty of ways to learn how to make money as a travel agent whether you’re working for yourself or for an agency. It involves becoming a partner with your customers to find them the best deals and exclusive perks that can’t be found with their own search.

Commission

When someone contacts a travel agency or independent agent, they want to book a vacation, which will include hotel accommodations, tours, car rental and cruise lines. All of these businesses will pay a commission to the travel agent for sending business their way. This happens all across the industry, so agents are not biased when they send a customer to one hotel over another. They’ll pick the best one based on the customer’s needs.

Business Travel Charges

Many businesses use an executive agency for all their travel needs. Business owners have a different itinerary than a vacationing family. They’ll want to book conference rooms, drivers for business meetings and hotel accommodations. While airlines don’t pay commissions on many of their flights, they can for certain classes like business class or certain routes. Travel agents who specialize in business travel build a relationship with customers and the vendors they need for travel. It differs widely from family travel and needs a special knowledge.

Travel Agent Service Fees

A travel agency that handles an entire package for a customer can charge a fee for their all-inclusive service. This is great for families, couples and solo travelers who want to deal with one agency for all their needs. Agencies provide tour packages that include travel accommodations as well as entire trips from the airline tickets to the car rental and amenities like museum tour packages. The travel agent becomes the tour guide for whatever area of the world that customer wants to visit. For this expertise and service, the customer pays a service fee.

Travel Agent Salary

The travel agent’s salary will depend on whether they are part of an agency or an independent agent working for themselves. Some agents have an expertise for certain areas of the country, or certain packages. That expertise can be rewarded with a higher commission or fees from the customers. The commission for packages can range from 10 percent to beyond for each booking. While a travel agent might book over $100,000 in revenue each year for various businesses in travel accommodations and airline tickets, they will receive only a percentage of that generated revenue.

While the travel agency model has changed from the time it existed before the Internet, there are plenty of opportunities for agents to make money and support their families. Customers with complicated plans, trips out of the country or disastrous accommodations know they can contact their travel agent to find them the best deals and exclusive perks not found online.